S&P 500 Price Prediction: $500B Wiped Out on Tariff News

The S&P 500 closed at 6,837.75, down 71.76 points or 1.04%, as Wall Street entered the final stretch of February under pressure. Futures attempted to stabilize on Tuesday morning, yet investors remained cautious after steep losses driven by trade confusion and fears of AI-driven disruption.

Source: CoinCodex

Borrowing costs continue to shape sentiment. The US 10-year Treasury yield hovers near 4.05%, keeping financing conditions tight for consumers and corporations. Elevated yields often challenge equity valuations, especially in rate-sensitive sectors such as real estate and banking.

At the same time, traders face renewed trade uncertainty. President Trump’s new 10% global tariff took effect on Tuesday. The White House is preparing a formal order to raise the rate to 15%, according to reports. 

The European Union warned that the levy breaches last year’s trade agreement, while Japan urged the US to avoid disadvantaging its exporters. Markets dislike uncertainty. Right now, trade policy offers plenty of it.

AI Developments With Another Layer of Risk?

Beyond tariffs, investors are closely monitoring artificial intelligence developments. Anthropic is hosting a key event featuring product updates and demonstrations of new tools. Prior AI announcements have triggered sharp sell-offs in sectors facing potential disruption, including cybersecurity and enterprise software.

This week also brings major earnings catalysts. Home Depot reports on Tuesday, while Nvidia, Salesforce, and Snowflake release results on Wednesday. NVIDIA’s report, in particular, may influence broader sentiment toward AI infrastructure spending. Could strong guidance calm nerves, or will any sign of slowing demand spark another wave of selling?

Meanwhile, economic data adds complexity. Traders will examine fresh consumer confidence figures, while recent Dallas Fed data showed near-stable factory conditions with firmer wage and production expectations.

Now, can tighter financial conditions cool inflation or slow growth too sharply?

What Technicals State

From a technical point of view, the S&P 500 has paused its decline but has not yet confirmed a reversal. The index formed a smaller consolidation range above a prior sideways zone and defended the support of that range last week.

Source: TradingView via X

This defense suggests buyers still protect near-term support. However, the market has not broken above the resistance of the smaller range. A breakout would strengthen the bullish case and signal bullish momentum.

On the downside, failure to hold the current consolidation could expose the next major support near 6,720. That level marks the midpoint of a larger consolidation structure that has defined price action since December. Will buyers regain control, or will sellers press the advantage? This week’s data will provide a thesis.

Outlook Hinges on Policy and Momentum

Markets look undecided for now. Trade headlines, AI developments, corporate earnings, range trading, all converge within days. Treasury yields remain elevated, and tariff policy continues to evolve.

The S&P 500’s ability to defend support while absorbing macro uncertainty will determine short-term direction. For now, price action reflects hesitation rather than panic. The next breakout, whether higher or lower, will set the tone for the new month.